Facebook accused of tricking children into spending thousands playing online games

Internal Facebook documents released as part of a class action lawsuit reveal that the company made millions of dollars from children playing Facebook games and spending their parents’ money, but did little to fix the problem. Reveal reported on Thursday that Facebook was aware for years that children playing games on Facebook would regularly spend large amounts of real money on games such as Angry Birds, PetVille and Ninja Saga, often without realising that they were spending money at all. Facebook conducted an internal analysis of its game revenue in 2011, the documents show. The internal Facebook report found that children spent $3.6m (£2.7m) on games between October 2010 and January 2011. One 15-year-old unwittingly spent $6,500 on Facebook games in two weeks in 2013, internal Facebook documents show. A Facebook employee said in the document that the child’s request for a refund should be refused. Facebook even developed its own term to refer to children unwittingly spending their parents’ money on Facebook games: “Friendly fraud.” The social media business also referred to children who spent large amounts of money as “whales” - the same term used by casinos to refer to high-spending gamblers. Despite realising that the social media business had a problem with children spending millions of dollars on its games, Facebook was hesitant to solve the issue. One document released in the lawsuit is a copy of a presentation given to Facebook employees. The issue of children spending money was covered in a section titled “Friendly fraud - what it is, why it’s challenging, and why you shouldn’t try to block it.” Facebook found in 2011 that around 9pc of the revenue it made from children spending on games was later refunded because of credit card chargebacks filed by parents. A document from 2014 found that the chargeback was unchanged at 9pc, suggesting that Facebook’s efforts to stop the problem had little effect. In 2011, a Facebook employee developed a solution to the friendly fraud problem. They suggested building a feature which would require Facebook users to enter the first six numbers of their credit card when trying to make a purchase in a game. The feature was not implemented, however. Technology intelligence - newsletter promo - EOA Facebook decided to settle the case in 2016, and agreed to develop a system to properly review refund requests made by the parents of children in the US. The newly released documents come as Facebook chief executive Mark Zuckerberg published an article in The Wall Street Journal defending his business. “We don’t sell people’s data, even though it’s often reported that we do,” Mr Zuckerberg wrote. Mr Zuckerberg said in his article that Facebook valued transparency, as well as giving its users choice and control over their data. “We need to be clear about the ways we’re using information,” he wrote. Facebook said in a statement that “we were contacted by the Center for Investigative Reporting last year, and we voluntarily unsealed documents related to a 2012 case about our refund policies for in-app purchases that parents believe were made in error by their minor children. We intend to release additional documents as instructed by the court.” “Facebook works with parents and experts to offer tools for families navigating Facebook and the web. As part of that work, we routinely examine our own practices, and in 2016 agreed to update our terms and provide dedicated resources for refund requests related to purchased made by minors on Facebook.”